NAM's Linda Dempsey Defends Fast Track Trade Pacts

Linda Dempsey, vice president for International Economic Affairs of the National Association of Manufacturers (NAM), appeared on C-SPAN's Washington Journal April 21 to discuss the pending negotiations surrounding the Trans-Pacific Partnership (TPP) free-trade agreement and the "fast track" authority Republicans are about to confer on the president in order to facilitate that agreement.

This writer's expectation was that she would offer readers a different perspective on the issue from that of Public Citizen's Lori Wallach, who appeared over the weekend.

Dempsey was interviewed by host Pedro Echevarria, who asked her to "make the case that the president needs this type of authority." Dempsey responded that "manufacturers in the United States, from the smallest to the largest, are competing in a global economy, and that global economy right now is tilted against us due to high tariffs and other barriers in the TPP countries and around the world, while the U.S. market is largely open."

She expressed the hope that new trade agreements would "supercharge" exports, but in order to do this, the administration needs Trade Promotion Authority (TPA) to strengthen the hand of U.S. negotiators. (In effect, what she is saying is that the negotiators have enhanced credibility because Congress has little power to affect the outcome since it can only vote up or down on the agreement.)

Echevarria challenged Dempsey to defend that lack of flexibility in the Congressional role in TPA agreements, and she acknowledged this is "exactly right" but defended the process as the way these negotiations have been conducted during the past 40 years. Dempsey urged viewers to think of the task of negotiating a 1,000-page agreement with 11 other countries, which entails compromises, and it is impractical for legislators to be able to single out particular provisions in the package for nullification, which would "unravel the entire agreement."

Echevarria then played a clip of remarks by Wallach on whether agreements such as the TPP, facilitated by TPA, lead to the outsourcing of jobs to low-wage countries rather than promote job creation for American workers. Wallach decried arrangements that put U.S. workers in direct competition with workers from countries like Vietnam, a TPP partner where workers make less than 60 cents per hour. She spoke of a "catch," which means that the president's claim to be opening markets is exaggerated, because the U.S. already has free-trade agreements with more than half of the countries in the TPP negotiations.

Wallach went on to charge that the "big prize" in the talks is Japan, which competes unfairly by manipulating its currency thereby conferring a "hidden subsidy" on its exports to discourage imports from the U.S. Wallach pointed to 60 Senators and 230 Congressmen, a bipartisan coalition, having written the president in 2013 calling for the agreement to include measures to prevent currency manipulation, but the president refused to press this issue.

Dempsey replied that there is "no evidence" to support Wallach's view, and she pointed to trade and investment relationships with Europe to refute it. (The synthesis of this argument is that trade agreements create winners and losers, which is why they are bound to be controversial.)

Linda Dempsey, vice president for International Economic Affairs of the National Association of Manufacturers (NAM), appeared on C-SPAN's Washington Journal April 21 to discuss the pending negotiations surrounding the Trans-Pacific Partnership (TPP) free-trade agreement.